How Government can Increase affordability of Indians?

Last few years especially from the year 2022, the inflation rate has increased drastically. The cost of basic necessities like food & other goods have increased significantly. At the same time the earnings have not increased as compared to inflation.

In other words, the affordability level of Indians has drastically decreased due to which struggle towards necessities and lifestyle up-gradement are becoming more struggling. These all are impacting the quality of life of Indians in a big way.

To enhance the quality of life of citizens, ease of life is very important. Jobs, businesses, institutions, inventions and innovations are mend to create ease in human life so people can live life peacefully and comfortably. Ease in life will help to build a happy and healthy nation. This yardstick can help to assess what kind of life people are living in their country.

Why government’s role is important?

Creating ease in life, role of the government is very important, especially in India. The policies are defining people’s life. So, if government policies are in line with people’s problems then life can be much easier for a large part of the population. The policies made by the government can very much create ease in life.

What are the major problems the large population is facing?

First, we should understand, in India what are the major problems the large population is facing? If we get to know the major problems then the policies can be designed keeping problems in mind. First basic necessities are very important for an individual which need to be addressed. After getting basic necessities, people can focus on their quality of living. 

What are the basic necessities that are stopping to live a quality life?

Four basic necessities are engaging the whole life of an Indian citizen.

1. Shelter
2. Kid’s education
3. Medical Security
4. Future Security

If you look at the lifespan from age 18 till end of the life, people are majorly struggling to get these four basic necessities either for themselves or for dear ones. These necessities are impacting the human mind & engaging life in such a way, that people are not able to think beyond necessities and are not able to uplift their quality of life. Their hard-earned money is majorly going into these necessities and the present earnings are not enough to take care of all these necessities. Due to this people are struggling in their own world whole life and in India life is becoming more and more struggling day by day.

Let’s see these four problems one by one keeping three aspects in mind

• what actually these problems are
• what presently the government doing about it
• what should be the suggestions that can help to resolve the problems

1. Shelter or Housing – Shelter means a house is a very basic necessity of a human. This is one of the major and costliest necessities that gulp out the major part of the earnings of an individual. To get a house, people are spending all their savings and assets like gold and taking loans from financial institutions. These all become a big burden on an individual which makes life more struggling for a longer period or say a major part of human life.

Now for quality living, one should need something beyond a house. The house should have a big area, good interiors and equipped with amenities which can create ease and comfort in life. This should not be limited to a class of people like poor, middle or rich. This should be the basic necessity that helps to live a quality life.

What are the problems in the housing sector?

In India, housing is more like an investment sector, where people are investing money to get higher returns on their investments. That makes housing like a gamble for the people who are wealthy, investing large sums of money to multiply their wealth. That is the main reason for inflation in the housing sector. Due to these, land/housing prices are souring like anything and making housing more unaffordable.

Large numbers of dwelling units are in the hands of investors and end users are living in rental housing. On one side people do not have a house and other side investors are having multiple housing units just to make money.  These major investors are wealthy businessmen, politicians, mafia, wealthy people and now the middle class has also start investing in housing sectors to fetch higher returns. 

These all factors are making the housing sector costlier day by day and the government does not have any control over it.

How can a shelter be an investment sector? That needs to be stopped.

What is the help the government is currently providing on housing?

The housing schemes are mostly for poor class people which are just an eye wash. A single-room accommodation for a family is not a real housing facility. In actual terms, it is a shelter that is just helping to protect from weather conditions. The sq-ft areas and quality of basic facilities are missing out in any such schemes.  

Also, these free schemes are for a limited amount of people. For above poor class, there is no such scheme available which is affordable.

How government can increase affordability in Housing?

Giving any such big free bees like housing can become a big burden on the government. Giving housing to each family is very difficult, especially in a largely populated country like India. It is an idle situation that if people can buy their house with their own money and the government can make it affordable.

The government should make stringent policies on the housing sector so the land price can be controlled and investors should be discouraged from investing in the housing sector. Similarly, agricultural land prices are becoming unaffordable, which is discouraging farmers from farming. Many wealthy people are investing in agricultural land to save taxes and to multiply their investments. So the policies should be like which can control the agricultural land prices too.

A few suggested policies may help to keep the cost of housing in a controlled manner.

• An individual should be restricted to keep more than one residential property.
• Heavy taxation should be imposed on second or more housing properties.
• Below age 18 individuals should be strictly restricted to keep housing property other than insister’s property which comes after death of an insister or if they are earning by own.
• If someone wants to secure housing for their child age below 18 then they should invest in housing bond which should be like a currency which can only be used to buy housing property after reaching child age above 18 on their name only and interest income on the bond should be tax-free.
• An individual should sell housing property with the condition that new housing property should be purchased within 1-2 years otherwise it should be imposed with heavy taxation.
• Taxation on returns on housing investment should be as higher which should discourage investment in the housing sector or keep extra housing units.
• In metro cities, the adjacent housing societies can singly or jointly re-develop their housing properties with the help of builders in such a way so that the multistory buildings with 5-6 times extra area can be created. The housing societies can sell such housing units at the government circle rate. The circle rate should be in such a way so if an individual purchases their first property, the rate applicable will be less and for the second property it should be on the higher side. The rate should not be market driven in case of re-development.
•  A family of 2+2 should get a minimum carpet between 1200-1500 sq-ft and for above 2500 sq-ft carpet area, the wealth tax to be imposed.
• Companies, corporations and businesses can buy housing property only for their employees which should be reasonably taxed.
• If someone is buying their first housing property for living and if doesn’t want to live then they can rent it out the property.
• Without registration of the property, it should not be considered as owner’s property.       

These are the basic outlines of suggested policies. The main intention is to remove housing sector from the investment sector. This will help to keep the affordability of an individual for buying housing property. The policies should be designed in such a way so it should discourage investing in the housing sector and first property rate should be such so the loan repayment can be done in 4-5 years.

2. Kid’s education – Educated citizens are always the backbone of the country so giving the best education to the children and youth is very necessary for any developing country.

In India, we are getting two kinds of education

(a) Basic education – Playschool till 12^th grade

(b) Higher education – Graduation, post-graduation and professional courses.

What are the problems in the Education sector?

Both the education systems are very costly at present time. Sometimes basic education is costlier than higher education. Every parent wants to give the best education to their kids so they can be successful in their life and can live a quality life.

Giving both educations is the prime liability on an earning member of the family and that eats big amount of hard earn money continuously for a very long duration of life around 19 to 23 years starting from playschool till nursery (4 years), 1^st to 12 grade (12 years), graduation (3-4 years), post-graduation or specialized courses (2-3 years).

Education is the basic necessity of an individual and giving such basic necessity is a big burden of an earning member of the family. If kids are more than one then these liability expenditures become multiple.

What is the help presently government is providing in education?

The government is providing basic education to the children through government schools. Those schools are limited in numbers. These schools are not well equipped with proper infrastructure, facilities and also quality of education is not up to the mark due to which most of the parents especially above poor class people are avoiding to educate their child in government schools.

There is a very big infrastructure of government schools across the country including metro cities, 2-tier towns and villages but infrastructure, amenities and maintenance are not up to the mark. Administration and accountability of the workforce are the major issues across most of schools.

In India only in Delhi, the state government has given a proven successful model of government schools where they are able to provide good infrastructure, facilities and quality education at very affordable cost.

Even in higher education, conditions are almost the same. Very limited government institutions are there as compared to the population. The fee structures are also high.

How government can increase affordability in Education sector?

In the education sector government’s role is very important. This should be one kind of investment the government should do on citizens to make the country prosperous. In India, education is unaffordable to a large part of the population hence government’s role is very very important.  

If you look into private schools, especially in higher education, the main investors are politicians. They are acquiring cheap government land and constructing schools/institutes to make higher profits.

Again in India, education institutes are mainly like an investment sector, where wealthy people are investing money to get higher returns on their investments. This should not be an investment sector.

The transformation of existing government schools should be the prime priority of the government.  If the government can able to transform existing government schools / Institutions then it will create big impact on society and the image of government schools can be improved.

Parallelly new government schools with proper infrastructure and facilities with quality education should be constructed. The accountability of the school administrators plays a very important role in providing quality education hence the policies should be astringent enough to have a good grip on administrative authorities.

A few suggestions/policies can help to transform the education sectors and make it very affordable.

• If the government allocates budget on old & new school transformation/ construction then the financial burden on the government will increase in a very big way. In India, many Organizations/ corporate/ businesses/ corporations are allocating money for CSR activities. In the same way, the government can collect funds in the name of the Education Fund by giving more tax rebates.
• Government land banks can be utilized to build new schools so the cost of making new schools should be minimized.
• Railways, Waqf Board like organizations are major land bank holders in India. Their land should be utilized to construct new schools.
• Rich people of India who have land banks should voluntarily donate their part of land for school infrastructure.
• Donations towards the Education Fund should be tax-free.
• A separate education department should be formed which only can monitor Up-gradement of old schools and the construction of new schools.
• Training institutes for teachers should be build to provide quality education. In this digital era, these training can be conducted by video calling. Every school should be equipped with a video conferencing room by which teaching and regular assessment of the teachers/facilities can be done.
• Best infrastructure and quality education should be the prime priority of the government & school administration.
• Encourage the private schools to make education affordable with quality.

These are a few suggestions/policies which can help to transform the education sector in a large way. Creating big competition with private schools/higher education institutions will re-think them to change higher fee structures which can make even private education also affordable.

3. Medical Security – In India, the Medical treatment has majorly three categories

• Medical consultation & Testing.
• Medicines
• Hospitalization & surgeries.

The medical sector is becoming unaffordable day by day. The cost of medical treatment is too high and sometimes people sell their land and jewellery to pay the bills of hospitals or medical treatment. These private hospitals have no mercy on their patients. Their objective is just to squeeze as much.

Those people who are covered with health Insurance policies are facing lesser heat but people who do not have insurance policies are shelling out their years of savings to pay the medical treatment/ hospital bills and many times destroy the families financially in case of severe diseases. Around 35-38% of people are covered with the health insurance policies in India. A large sum of the population is still without health insurance policies.

Also, these health insurance policies are still unaffordable especially policies provided by the private sector and these policies are covering large sums of amounts but not fully. Even after paying premiums, hospitals are charging many components that are not covered in insurance policies.

Medicine cost is 5-6 times the manufacturing cost which makes basic medical treatment un-affordable. The costs of the medicines are multiple times of the manufacturing cost which is again a big burden on an individual. 

Medical consultation and testing rates are also becoming unaffordable day by day. The rates are shooting up more than inflation rates. Hospitalization cost have always high for decades.

What are the problems in the Medical sector?

In India, medical education is one of the costliest education where people are spending lakhs & crore rupees to make their child doctor. After investing such higher amounts in medical education, people are expecting to recover multiple times of their investment, which is creating a foundation of greed in a noble profession like medical. There are no such trainings in medical education which establish in professional’s minds about importance of this noble profession and teaches them, how they can do service for human well-being.

One of the main factors is that the importance of money is increasing day by day and sectors like medical profession are impacting a big way which is not good for human well-being.

In the medical profession, surgery is like a boon that gives life to many but the costs of surgeries are too high where a major part is the doctor’s fee. In this money earning race, the doctors are becoming richer day by day.

There is no control of government in these private sectors to create affordability. Sometimes major illnesses destroy families financially where there is no support from the government.

What is the help presently government is providing on Medication?

In India, the infrastructure of government hospitals is widespread across the country. Also, the treatment costs in government hospitals are not much affordable but not too expensive as compared to private hospitals. The small dispensaries are available in the villages, although the standards and hygienic conditions are not up to the mark.

Across metro and big cities, few labour welfare hospitals known as ESIS hospitals are available which mainly to take care of most of the un-skilled and labour class.  These hospitals are very limited in number as compared to the population.

Also, few hospital infrastructures are available for Central/ State government employees which are catering treatment to government employees. Defense forces are also having their own hospitals in very limited locations.

How government can increase affordability in Medical Sector?

The government must provide good and affordable medical treatment to the citizens of the country. Building proper government infrastructure across the country is very necessary.

The government should deeply review the medical sector so a normal citizen should not fear getting the treatment which is a basic right of a citizen and the government should ensure affordable medical treatment.

A few suggestions can improve the affordability of this sector.

• The government should construct new hospitals & medical Infrastructure across the country with modern medical amenities.
• Government should review existing government hospitals infrastructure and make it more organized and equipped with latest medical facilities.
• To create funds for making medical infrastructure, the government should introduce three kinds of Medical Cards (Platinum, Gold & Silver) for an individual by paying a nominal monthly/ Yearly fee.
  1. Fee for Silver Card – Rs 40/- per month
  1. Fee for Gold Card – Rs 120/- per month,
  1. Fee for Platinum Card – Rs 160/- per month,

(the rates are just for reference)

• This card should cover hospitalization, treatment, medicine, medical tests, and consumables at very affordable pricing around 80% cheaper than the present rate.
• The tentative collection can be done by these cards will be tentatively projected in the below table.

• This calculation is based on the consideration that 125 crore people will purchase the card. If this medical card has been distributed to 125 crore people then yearly collection will be Rs 1,08,000 crore which can be utilized for constructing, maintaining & operating hospitals. Other than this the treatment cost will be the additional revenue which helps.
• The start-ups and young entrepreneur participation should be ensured to develop these infrastructure, maintenance and operations too.
• Medical education selection should be through the competition only and the fee structure should be very much reasonable so the medical education cost should be very much affordable. 

These suggested policies are to provide affordability in the medical sector and ensuring less transactions or earning of money by this noble profession. Same time affordability in treatment will help citizens to comfortably utilize the treatment facilities.    

3. Future Security – In human nature, future security is always one of the top priorities. Everyone wants a secure life so that the life can be lived with ease.

Creating future security has been inbuilt especially in Indians since ages and this security they are creating either in the form of gold, property, investments, pension or cash. This tendency to save money for future security is one of the major strengths of the Indian economy.

In any developed country, most of the citizens purchase goods/assets by taking loans from financial institutions with maximum limit of 90-100%. The risk on the financial institutions is much higher than the individual in case of failure in repayments of loans. But in India, large population purchase goods/assets by shelling out their own savings and the rest they are managing by loan. So the risk on financial institutions in India is much lesser than in the developed country. That is why most of the rescissions across the world are hardly impacting the Indian economy.         

This fear of future security comes from the Indian culture where people ensure support to their children till they get employment. Even after, they are saving money for their children’s marriage too. So the required corpus for future security is much higher as compared to any developed country.

Keeping this fear intact will help Indian citizens to earn more, save more and invest more. These all will help to make the Indian economy healthier.

What are the problems to provide future security?

Providing future security by the government like providing jobs, pensions, free housing, free treatment, free education, etc to all groups of people is very difficult in such a large populated country.

To provide future security, large funds are needed which can empty the cash reserve of the government in the long run which is not a good practice in any healthy economy. Many countries have become bank corrupt due to the distribution of free bees to their citizens.

Also, if the government will provide future security then why people will work?  

What kind of Future Security presently government is providing?

In India, the government is providing future security mainly to the government employees in the form of job security, free housing, free medical, retirement corpus, lifelong pension, etc. This is one of the main reasons, still government jobs are more lucrative than any other profession.

On the other side, few schemes are for the poor but do not provide future security in the long run.

How government can ensure future Security of Indian citizens?

If the government can able to create affordability in housing, children’s education and medical security then people can create future security by own form their earnings & savings. This fear of future security will encourage citizens to earn more, save more and invest more.

A few suggestions may help the government to create job opportunities so that people can earn faster and get employment easily so by own they can build future security of themselves.

• The government’s main work is to provide more earning opportunities across all the groups of people by their policies. These policies should be framed in such a way, that can encourage to create large number of earning opportunities by setting up large institutions/ corporate in India.
• Encouraging research institutions will help to develop useful products which have global demand with high margins. Further manufacturing of such products will create more earning opportunities.
• Creating government jobs and participation of young start-ups in suggested basic necessities sectors like Housing, Kid’s education, Medical security will create large sums of earning opportunities.
• If affordability can be created in Housing, Kid’s education, Medical security then people can focus to save large sum of amount by their earnings during age 18 to 50 (32 years) and after age 50 they can help in these three sectors voluntarily or on nominal charge basis.
• Creating affordability in these three sectors will help the government to reduce free-bee schemes to the citizens. The same fund should be diverted to create more earning opportunities.

This is just an outline, the main intention to create more earning opportunities with proper payouts so people can create their future security by themselves.

Why government should build infrastructure for these three basic necessities?

There was an era when many semi-government sectors were created with the intention to create more earning opportunities but most of these semi-government sectors failed due to lack of administration and accountability of workforce. If administration and accountability of work force can be ensured then the government can successfully build and operate suggested government infrastructure in housing, kid’s education and medical sectors.

Housing, kid’s education, and medical security, three are very necessary to ensure the basic necessities of Indian citizens and only the government can ensure and fund these large infrastructure facilities. Direct involvement of the private sector in these sectors will not help. Creating ease in citizen’s life must be the government’s responsibility.

What will happen if the affordability issue has not been addressed?

In India, affordability is the major issue due to which the importance of money is increasing day by day. This is making life of an individual more struggling. Many crimes are happening due to money. This can create social imbalance which is not for any healthy society.

If the affordability issue has not been addressed then “Quality Life” will become the dream of large part of the Indian population.

What should be the right scenario?

Let the government provide basic necessities like Housing, Kid’s education, Medical security at lease prices and people should work on their quality of living and create future security for themselves.

These affordability should be created in such a way so that people can repay their home loans in 4-5 years, Kid’s education cost will be very nominal (almost free) with high standards and medical cost will be nominal (almost free) by paying membership.

The step by the government to create affordability in basic necessities like Housing, Kid’s education and medical security will help people to divert their mind towards Quality Life and for building Future Security which can create a healthy society and strong nation.